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IBM (IBM) Stock Moves -1.18%: What You Should Know

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In the latest trading session, IBM (IBM - Free Report) closed at $117.10, marking a -1.18% move from the previous day. This change was narrower than the S&P 500's daily loss of 1.9%. At the same time, the Dow lost 1.86%, and the tech-heavy Nasdaq gained 0.31%.

Heading into today, shares of the technology and consulting company had lost 6.16% over the past month, lagging the Computer and Technology sector's gain of 1.95% and the S&P 500's gain of 1.2% in that time.

IBM will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $3.80, up 83.57% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $18.98 billion, down 6.79% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $10.40 per share and revenue of $73.3 billion, which would represent changes of +19.95% and -0.44%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for IBM. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. IBM is currently sporting a Zacks Rank of #5 (Strong Sell).

Investors should also note IBM's current valuation metrics, including its Forward P/E ratio of 11.4. For comparison, its industry has an average Forward P/E of 18.51, which means IBM is trading at a discount to the group.

We can also see that IBM currently has a PEG ratio of 1.92. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Computer - Integrated Systems was holding an average PEG ratio of 1.68 at yesterday's closing price.

The Computer - Integrated Systems industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 232, putting it in the bottom 9% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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